Dollarama says ‘comfort zone’ for leverage ranges from 2.7x to 2.75x

By Devika Patel

Knoxville, Tenn., Sept. 13 – Dollarama Inc. is permitted to have a leverage ratio of up to 3x, but the company prefers to operate in the range of 2.7x to 2.75x.

“We’re allowed up to 3x [leverage] but our comfort zone is 2.7x, 2.75x adjusted debt to EBITDAR,” chief financial officer Michael Ross said on the company’s second quarter ended July 29 earnings conference call on Thursday.

EBITDA grew 7.9% to C$225.8 million in the quarter ended July 29, 2018 when compared to the quarter ended July 30, 2017.

The company's cash balance was C$181,703,000 as of July 29, compared to C$54,844,000 as of Jan. 28.

The dollar store operator is based in Montreal.

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